1. Field of the Invention
The present invention relates generally to the foreign exchange financial industry. In more specific aspects, the present invention relates to account payment systems, software, and methods.
2. Description of the Related Art
International payment transactions frequently involve transferring money from a domestic account to the account of the payee. In a typical international payment transaction, a bank customer initially places an order at a local bank holding the customer's account. The local bank then typically contacts a domestic financial institution having a direct relationship with another financial institution in the destination country to prosecute the transfer. This results in a chain of financial institutions being involved in the transaction, causing added expense and delay, and may involve a significant foreign currency risk. This expense can be excessive where a customer has frequent need for transferring funds to various foreign accounts.
Some modern systems have tried to solve these difficulties. For example, U.S. Pat. No. 5,825,003, by Jennings et al., titled “Customer-Directed, Automated Process for Transferring Funds Between Accounts Using A Holding Account And Local Process,” describes a system which allows a user, through an ATM or computer terminal, to request a single transfer of funds from a source bank account to a second destination bank account in another country.
Also, for example, World Intellectual Property Organization (“WIPO”) Publication No. 01/84276A2, by Harada et al., titled “International Payment System And Method” describes a system and method for moving funds from a source account in one country to a destination account held in another country and bypassing the traditional SWIFT international settlement system. As described in this patent document, a customer first enrolls for the service, obtains a configured account within the system, and receives a unique customer identification number. The system includes a graphical user interface (“GUI”) that includes input fields for entering destination payee information which is stored in the system database and related to the customer's identification number. To prosecute an order, the customer logs on and provides transaction parameters including payee, dollar amount of transaction, type of currency for making payments and the source customer account for making a payment. When the transaction involves a transfer to a single payee, the system receives a spot rate for the currency, determines additional fees and final exchange rate, and provides the total for the transaction. The customer must approve the transaction to initiate payment. The system sends payment instructions independently of the actual money transfer in order to attempt to eliminate the need to execute a chain of credits and debits between correspondent financial institutions.
Bank customers having a frequent need to transfer funds to cover accounts payables, however, often desire a more business oriented system with a focus on obtaining an optimum exchange rate with minimal foreign currency risk. Foreign exchange rates, however, are highly variable, and numerous factors influence the exchange rates, such as economic strength of countries, political stability, countries' transnational policies and relationships, demand for foreign currency, and, of course, the size of the transaction. Due to high variability and numerous factors influencing the exchange rates, it is extremely difficult to predict future exchange rates even for a short period. Where the bank customer requires frequent transfers of funds to various foreign accounts as when prosecuting the settlement of accounts payables, the bank customer often must either establish a foreign currency account or establish a foreign bank account in order to reduce foreign currency risk. The customer typically establishes either of the accounts with sufficient foreign currency funds to cover an estimated block of accounts payables.
Similar to prosecuting individual transactions described above, in settling the accounts payables, the customer typically delivers individual instructions and payment information to the local or foreign bank for each of the accounts payables. Where the customer utilizes a foreign currency account established in a local bank, the customer can face numerous bank transactional charges and other charges related to foreign exchange transactions and fees of an intermediary utilized to transfer the funds to the foreign payees. Where the customer utilizes a foreign bank account, the customer faces reduced foreign exchange transactional fees but can be saddled with increased foreign bank transactional fees and an increased foreign exchange currency risk.
The Applicants, however, have recognized that there still exists a need for reducing the number of cross-border flows in order to reduce the number of foreign exchange transactions and correspondingly reduce financial institution and intermediary charges with respect to the foreign exchange transaction. Also, Applicants have recognized there is still a need to minimize the amount of foreign currency required to be held in a foreign financial institution in order to settle a customer's accounts payables while retaining the ability for a customer to reconcile individual accounts payable transactions at the payment level, if desired.